Director fined $57,000 for 38 Companies Act charges

He failed to hold the annual general meeting and file annual returns for 19 firms.

Company director Lawrence Fong Kok Liong was convicted and fined a record $57,000 for 38 charges ($1,500 per charge) in the State Courts. He pleaded guilty to the charges for offences under section 175 and 197 of the Companies Act (CA) for failing to hold the annual general meeting (AGM) and failing to file annual returns (AR) in relation to 19 companies.

According to an announcement, Fong had been convicted in 2014 for similar offences and compounded 60 similar offences. A further 78 charges were taken into consideration for the purpose of sentencing.

The holding of AGM and filing of AR are important statutory requirements, the Accounting and Corporate Regulatory Authority (ACRA) noted. These provide a forum for shareholders to be informed of the financial position of the company, engage the directors of the company on the matter, and enable timely public disclosure of key information such as the health and status of the company.

This latest conviction comes on the back of the convictions of five other directors for similar filing offences in April and May 2018. Two of the five directors were given a record fine of $1,800 per charge, which were above the range of $800 to $1,200 per charge usually meted out for such offences.

Fong and the other five directors prosecuted in April and May 2018, will also be disqualified as directors of the companies to which they have been appointed. As a deterrence to persistent offenders, ACRA disqualifies directors who have been convicted of three or more filing related offences under the Companies Act within a period of five years or had three or more companies struck off the register by ACRA within a period of five years.

Once disqualified, an individual will not be allowed to be a company director or take part in the management of any local or foreign company for five years, effective from the date of the conviction. These disqualified directors cannot take on any new appointment as a director, or be in any way directly or indirectly concerned or take part in the management of a company.

From 25 July 2018, ACRA will publish on its public register, all directors who have been disqualified from acting as directors. The disqualified status for a director will be displayed in the business profile and directors profile report of the company.